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The holiday season is now officially underway. Cities around the world are soon to be draped in twinkling lights, while retailers ready themselves for the large influx of customers who make this time of year among the most lucrative. One theme we are likely to see everywhere is the color red: red lights, hats, sale signs, poinsettia flowers, décor, ribbons and ornaments, etc. Given that red is the accepted color of the season, how much do we really know about its effectiveness in generating sales in shops around the world?

The answer is really quite surprising. Some argue that red is psychologically arousing and excites us to shop.[1] Others argue that red leads to an increased attention to detail.[2] Most interestingly, however, is how men and women react differently to the color itself. In retail environments, men report that when they see red sale tags they believe that they are receiving a more favorable price and feel positively about the decision they have made – it is a valuable heuristic used to make shopping simpler. Women, on the other hand, report feeling suspicious about red, and are under the impressing that they are being tricked.[3] Researchers at the University of British Columbia have found that we associate red with stop signs, fire trucks, and the teacher’s pen – all things that produce an element of danger.[4] Danger, however, can signal power, which is where red’s appeal in retail becomes apparent.

How can your business capture its share of the estimated $640 billion market? [5] Biological and neurological studies have arrived at the same conclusion. The answer is red. Have your salespeople incorporate red into their uniforms, or perhaps use red lipstick or blush in their makeup routines, as these tactics have been known to increase consumer spending. Insofar as red signals power, it also signals attraction, with both men and women reporting higher levels of attraction for the opposite sex when wearing red clothing, resulting in consumers reaching deeper into their pockets than they otherwise would have.[6]

A lot is known about two types of mental processes in the brain: System 1 and System 2. The former is concerned with subconscious, automatic reasoning, whereas the latter is concerned with conscious, intentional more deliberate type of reasoning.

Just as these two systems can be regarded as ‘complementary opposites’ to each other, they can have very distinct applications in marketing.

Because system 1 specializes in making fast (subconscious) judgments, the retail environment with its hundreds of same-category products requires that the emphasis should be on utilizing the skills of System 1. When a customer enters a retail store, the abundance of lights, colors, signage and sounds can distract the customer insofar as there are no unique stimuli that can draw the customer’s full, undivided attention that ultimately results in a purchase.

A company’s products, therefore, needs to be sufficiently unique in terms of design, contrast (with competitive brands), readability etc. so that the impatient customer is ‘allowed’ to use the fast-thinking System 1 when crawling the isles in search of the right product and thereby making a quick decision.

Attract recommendations.
Showing the opinions of other people, even complete strangers, influences purchase decisions. Including recommendations in your online shop can increase the purchase volume by 20% or more. The inclusion of the fans profile photo can bolster this a further 10%. Free gifts trigger reciprocity: offer a free gift in exchange for recommendations and increase your sales turnover and loyal customers at the same time. Use social media to make it super easy for your customer to endorse your brand and share information at the same time.

Sara Fay is founder of Whitematter Marketing in the United Kingdom.

This tip appeared in an article about retailing in the quarterly Neuromarketing Theory & Practice.

Expectations can determine the perception of your product. Setting that expectation and spreading it is the next step, but beware of trickery.

Consumers are constantly told that the latest Nike running shoes or Mercedes-Benz can offer higher performance. Consumers believe it, they make a purchase and they even experience it. From sportswear to cars, expectations of a product or service can actually create a resulting experience. But how?

Even the savviest and most jaded consumers rarely approach a new product with complete objectivity. A multitude of factors tell us what to expect, including price, packaging and the product’s ad campaign, among others.

But just how powerful are these expectations in shaping customers’ thoughts about what they consume? And how do they influence future behaviour and sales? Pre-consumption expectations about a product affect more than what we say, or even what we think, about that product. Our biases are reflected in our brain activity, affecting our perceptions of what we consume at a deeper and more direct level than psychologists can measure, says Hilke Plassmann, Assistant Professor of Marketing at INSEAD speaking about her recent paper How Expectancies Shape Consumption Experiences, co-authored by Tor D. Wager of the University of Colorado at Boulder.

An MRI/Wine Tasting
Plassmann’s conclusions stem from a study she co-conducted in 2008 measuring neural responses to drinking wine. Participants were instructed to sample various wines through a straw from inside an MRI machine. The rub? The researchers deliberately misled participants about the prices of the wines, claiming one cost US$45 when it actually cost US$5 and presenting another as costing US$10 when it really retailed for US$90.

“This allowed us to observe their brain activity while they were consuming the wine,” Plassmann told INSEAD Knowledge in an interview. “Are they rationalising after the fact that it should be better because it’s more expensive, or does it really change their taste processing? What we found is that it really changes the neural activity in an area called the medial orbitofrontal cortex, which is an area that encodes our experience of pleasure.”

These results came as a surprise to some of Plassmann’s collaborators on the study. “Some of us were thinking, ‘Oh, it’s more like rationalisation; it’s more like a cognitive process.’ At this point it was an open question. We had competing hypotheses.”

For Plassmann, the findings highlight the speed with which humans form lasting impressions that synthesise all types of data. “The bias kicks in at a very early stage,” she says. “It really changes your taste perception, or your visual perception, or your pain perception. These are complex processes where you receive a lot of input, and such information that has nothing to do with the taste itself – they are so fast, and integrated more holistically into your experience that you can’t distinguish. You think it’s linked to the taste.”

Check for bottom-up visual attention. Extensive eye-tracking research has documented that bottom-up attention is automatically activated, without conscious control, immediately when a person sees something new in his or her visual field.

People unconsciously divide web pages into areas of promise. Some features of viewed objects are naturally visually salient, which means they automatically attract bottom-up visual attention. Examples are: brightness relative to background, distinct borders, the center of the viewing area, tight groupings of visual objects, overlapping items, movement (especially around the edges), faces and locations where faces are looking.

These automatic attractions are so predictable that we can find good results without eye-tracking. The software can deliver up to 80% accuracy compared to a real eye-tracking study, which saves a lot of money.”

Steve Genco is a director at Intuitive Consumer Insights. He is co-author of Neuromarketing for Dummies.

This tip appeared in an article about retailing in the quarterly Neuromarketing Theory & Practice.

Check for bottom-up visual attention. Extensive eye-tracking research has documented that bottom-up attention is automatically activated, without conscious control, immediately when a person sees something new in his or her visual field.

People unconsciously divide web pages into areas of promise. Some features of viewed objects are naturally visually salient, which means they automatically attract bottom-up visual attention. Examples are: brightness relative to background, distinct borders, the center of the viewing area, tight groupings of visual objects, overlapping items, movement (especially around the edges), faces and locations where faces are looking.

These automatic attractions are so predictable that we can find good results without eye-tracking. The software can deliver up to 80% accuracy compared to a real eye-tracking study, which saves a lot of money.”

Involve your employees. Shopping is a human emotion. Your employees are the ones who can evoke this emotion on an everyday basis in your clients. Stop talking about the shopping experience that you want to offer, and let them feel, smell, touch and experience what you are talking about. Give them a feeling of what you are aiming at, in your own stores and those of others. Many workers will change their daily routines immediately when they actually experience the goal their boss is aiming to achieve.

Karin Glattes is a director at Unternehmen Kunde

This tip will appear in an article about retailing in the next edition of the quarterly Neuromarketing Theory & Practice.

Neuroresearch shows that 80% of all brochures fail to activate a buying intention. Most often retailers forget to make one or more promises that appeal to and activate the consumer.

They also often forget to envisage their target audience themselves, which means that the brain cannot activate its mirror function. To be more effective a retailer should do as follows.

1. Offer a reward. The brain is very sensitive to rewards, so make a promise that shows what the consumer will gain.
2. People always mirror themselves in others: show people visuals of happy consumers making successful use of the product.
3. Justify your discounts: make them credible. Customers want to know why you are offering a discount, and why you are doing so now. Better brochures could save the retail industry a lot of money: looking at the Netherlands alone, retailers spend more than €7O0 million a year on brochures.

Martin de Munnik is managing partner at Neurensics

This tip will appear in an article about retailing in the next edition of the quarterly Neuromarketing Theory & Practice.

Humans rarely perceive things in absolute terms. Most things we see are influenced by their surroundings or by what we have seen in the past. Interestingly, even the way we perceive numbers is biased in this way. There is a category of numbers that is highly relevant for market success: prices. A product placed withing a plethora of higher priced products seems to be a good deal, while when placed among cheaper alternatives it will appear overpriced. A slice of basic chocolate cake at a price of €2.50 at a fancy pastry shop may seem cheap because it is surrounded by many expensive pastry creations. A slice of chocolate cake for the same price sold at the bakery next door, where a muffin or a brownie costs just €1, makes the cake appear overpriced.

It is fascinating that this effects remains even if the perceptual distortion is well-known. In one study subjects were explicitly informed about such biases. The participants' number estimates were still influenced by previously shown numbers. Because prices are somewhat arbitrary numbers associated with a product, they are especially susceptible to their surrounding and to surrounding prices.

Kai-Markus Mueller is MD of The Neuromarketing Labs in Germany one of the speakers on the Neuro Retail Revolution

This tip will appear in an article about retailing in the next edition of the quarterly Neuromarketing Theory & Practice.
Via Radboud University Nijmegen

A new method of analyzing MRI brain images enables researchers to determine which letter a test subject was looking at.

Image courtesy of Radboud University Nijmegen

By analyzing MRI images of the brain with an elegant mathematical model, it is possible to reconstruct thoughts more accurately than ever before. In this way, researchers from Radboud University Nijmegen have succeeded in determining which letter a test subject was looking at.

The journal Neuroimage has accepted the article, which will be published soon.

Functional MRI scanners have been used in cognition research primarily to determine which brain areas are active while test subjects perform a specific task. The question is simple: is a particular brain region on or off? A research group at the Donders Institute for Brain, Cognition and Behaviour at Radboud University has gone a step further: they have used data from the scanner to determine what a test subject is looking at.

The researchers ‘taught’ a model how small volumes of 2x2x2 mm from the brain scans undefined known as voxels undefined respond to individual pixels. By combining all the information about the pixels from the voxels, it became possible to reconstruct the image viewed by the subject. The result was not a clear image, but a somewhat fuzzy speckle pattern. In this study, the researchers used hand-written letters.

Prior knowledge improves model performance

“After this we did something new’, says lead researcher Marcel van Gerven. ‘We gave the model prior knowledge: we taught it what letters look like. This improved the recognition of the letters enormously. The model compares the letters to determine which one corresponds most exactly with the speckle image, and then pushes the results of the image towards that letter. The result was the actual letter, a true reconstruction.”

“Our approach is similar to how we believe the brain itself combines prior knowledge with sensory information. For example, you can recognise the lines and curves in this article as letters only after you have learned to read. And this is exactly what we are looking for: models that show what is happening in the brain in a realistic fashion. We hope to improve the models to such an extent that we can also apply them to the working memory or to subjective experiences such as dreams or visualisations. Reconstructions indicate whether the model you have created approaches reality.”

Improved resolution; more possibilities

“In our further research we will be working with a more powerful MRI scanner,” explains Sanne Schoenmakers, who is working on a thesis about decoding thoughts. “Due to the higher resolution of the scanner, we hope to be able to link the model to more detailed images. We are currently linking images of letters to 1200 voxels in the brain; with the more powerful scanner we will link images of faces to 15,000 voxels.”

What does a bookstore smell like? If you frequent used or antiquarian book sellers, you probably think of musty paper, perhaps with an occasional mildew note. In big box bookstores like Barnes & Noble, the predominant aroma is often a pleasant espresso smell from the coffee bar. But, all of these retailers need to rethink their scent environment – a new study to appear in the Journal of Environmental Psychology shows that infusing a chocolate scent into a bookstore kept shoppers browsing longer and inspecting more merchandise.

Researchers in Belgium monitored customers in a bookstore both with and without a subtle chocolate aroma. They found a significant effect on shopper behavior. When the scent was present, shoppers were:

More than twice as likely to examine multiple items
More than twice as likely to read synopses for multiple books
Nearly three times as likely to interact with store staff
Less than half as likely to seek out one item and go directly to the register

The scientists also found that items “congruent” with the aroma of chocolate, food-related books and romance novels, saw an uptick in interest from female shoppers. There was an indication of a positive effect on sales, but the data was insufficient to draw a conclusion.

They did note that customers browsed non-congruent categories less when the scent was present, so chocolate scent isn’t a panacea for every retail sales environment.
Still, this study offers more evidence that subtle changes in environment can affect customer behavior. Music, too, can have an impact. In Audio Branding: ‘Tis the Season, I describe how a wine shop sold four times as much French wine when French music was playing in the background.

What should retail stores do? While chocolate scent might be a good choice for a generally pleasant smell, dispersing an aroma that relates to the products for sale would likely be better. Selling hunting gear? Perhaps a woodsy pine scent. Similarly, a seaside aroma might work for a swim shop.

Chocolate scent may not be enough to reverse the decline in bookstore sales, but this study points the way to keep customers in any retail environment shopping longer and looking at the merchandise more closely.

Roger Dooley is the author of Brainfluence: 100 Ways to Persuade and Convince Consumers with Neuromarketing (Wiley, 2011) and one of the speakers of last year's edition of the Neuromarketing World Forum in São Paulo. Find Roger on Twitter as @rogerdooley and at his website,Neuromarketing.

This article originally appeared at Forbes.com: Keep Your Customers Shopping... With Chocolate!